Want to invest in Ethereum? Now what? As first-time investors in blockchain technology it didn’t take us long to discover that building a crypto-currency portfolio with no prior experience isn’t as straightforward as it should be. Below we share what worked for us, the lessons we learned and the steps we took to successfully complete our first trade.
First, limit your choice to well-known platforms
As a first-time investor, you want to make sure that you get it right the first time. This is why limiting your choice to the most well-known platforms is key to ensuring a smooth experience.
Despite an extensive number of crypto-currency trading platforms available, only a handful have been credible enough to withstand data breaches. You want to feel comfortable that your platform will not be compromised and that it will still be there years down the line. In this case, ensure you read independent reviews to determine which platforms suit your needs, have the best security provisions and support the largest user bases.
After finding the platform you are most comfortable with, stick to that platform. You do not want to be in a situation where you are spreading your data across multiple platforms and therefore increasing your chances of monetary losses due to fraud.
Just like us, if you aren’t satisfied with your initial choice change platforms as soon as you can. This is typically an easy process. Most importantly, make sure your entire user data is wiped from their database. If needed, request an email confirmation.
Have your ID ready
A credible platform will naturally ask for identification. Passports, IDs or driving licenses as well as proof of address issued within the past three months are required to pass the initial identity verification stage of your account. This requirement may seem a little stringent but is actually a standard procedure across the industry and in line with Know Your Customer (KYC) regulations.
The platform will ask you for your country of registration. Ensure that all of the documentation that you provide (e.g. passport, residence cards, utility bills, account statements) matches that country to make sure the registration process is as smooth as possible. Given that some members of Empty Bucket have been living abroad for a number of years, this was especially important. Good news is that if you follow the platform’s standard requirements, you will be able to register with little drama.
Test the waters
Once your account is verified fund your account with only a small amount at first. For those savvy investors looking for a cost-effective solution to funding your account, note that Transferwise does not work. Empty Bucket ended up using our own banking providers and the cost associated with this was minimal. Do check with your banking provider to see whether this is best for you.
For any new deposit, you will attract transaction fees from both your banking provider for the international transfer and your selected platform. By funding your account with a small amount at first, you will be able to gauge the costs of the platform and ensure that the process is legitimate and scam-free.
Empty Bucket’s initial transfer was worth £100. Our bank charged us between £4 – £9 transaction fee at their nominated exchange rate, and our platform charged us 0.16%. The transfer was successful and took three business days for the funds to clear.
Note that different platforms vary in their funding capabilities. Some support debit/credit card transactions while others only allow for bank transfers. However, in our experience, the providers that are able to accept card payments charge an additional fee.
The initial setup of the platform and the completion of international transfers does take time. The first transfer will typically take longer to process compared to subsequent transfers as the platform will need to perform some initial verification checks to ensure that the source of the funds is coming from a legitimate location.
Use two-fold verification
This basically means that you use two passwords to access your account, effectively meaning that your account, Ethereum, cash and personal information is many times more secure. This is easy to set up and is common among platforms.
We currently use a two-fold verification process. For more advanced users, some platforms allow you to go a step further and use dynamic encryption.
Just like our other articles on our website, we’ve shared our own views, experiences, and steps taken. As always, we encourage our readers to be critically minded and to do their own research before making their first transaction.
In our next article, we will share our experiences with Kraken in more detail.
In the meantime, good luck!